Elizabeth Warren: Foreclosure Scams Show Need for New Consumer Agency

In an op-ed published in the Miami Herald,Elizabeth Warren makes a strong case for a new consumer agency: 

No one has missed the headlines: Haphazard and possibly illegal practices at mortgage-servicing companies have called into question home foreclosures across the nation.

The latest disclosures are deeply troubling, but they should not come as a big surprise. For years, both individual homeowners and consumer advocates sounded alarms that foreclosure processes were riddled with problems.

While federal and state investigators are still examining exactly what has gone wrong and why, two things are clear.

First, several financial services companies have already admitted that they used “robo-signers,” false declarations, and other workarounds to cut corners, creating a legal nightmare that will waste time and money that could have been better spent to help this economy recover. Mortgage lenders will spend millions of dollars retracing their steps, often with the same result that families who cannot pay will lose their homes.

Second, this mess might well have been avoided if the Consumer Financial Protection Bureau had been in place just a few years ago.

The new consumer agency is one of the signature accomplishments of the Dodd-Frank Wall Street Reform and Consumer Protection Act signed into law by President Obama this summer.

READ THE WHOLE THING HERE.


 

 

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Posted at December 29, 2010, 1:52pm

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